Diversification Feasibility Templates

Procedure:
1. Introduction to the Diversification Feasibility Framework: Recognize that the Diversification Feasibility Framework is a strategic tool used to evaluate an organization's potential to diversify its products, services, or markets. This framework aids in identifying the opportunities and challenges associated with diversification, ensuring that the strategy aligns with the company's capabilities and objectives.
2. Understand the Current Business Model:
2.1. Product/Service Portfolio: Analyze the existing range of products or services the company offers.
2.2. Market Segmentation: Understand the current markets, demographics, or segments the company serves.
2.3. Core Competencies: Identify the organization's primary skills, knowledge, technologies, and capabilities that give it a competitive edge.
3. Identify Diversification Opportunities:
3.1. Market Diversification: Research new markets, geographies, or customer segments the organization can enter.
3.2. Product/Service Diversification: Explore opportunities for introducing new products, services, or variants to current or new markets.
3.3. Vertical Integration: Consider opportunities to diversify along the supply chain, either backward into sourcing/raw materials or forward into distribution.
4. Evaluate Strategic Fit:
4.1. Alignment with Core Competencies: Assess if the diversification leverages the company's existing competencies or requires entirely new skills.
4.2. Synergies with Current Business: Determine if the new venture will complement or benefit from the existing business in terms of brand, distribution, technology, or other factors.
4.3. Cultural and Operational Fit: Analyze if the diversification aligns with the company's culture, values, and operational methodologies.
5. Assess Financial and Resource Implications:
5.1. Capital Requirements: Estimate the investment needed for diversification, including infrastructure, technology, and acquisitions.
5.2. ROI Projections: Forecast the potential returns from the diversification over a specified period.
5.3. Resource Allocation: Determine the human, technological, and operational resources required and assess if they can be sourced internally or need to be acquired.
6. Analyze Market and Competitive Landscape:
6.1. Market Trends: Understand the trends, growth rates, and potential shifts in the target market.
6.2. Competitive Analysis: Identify and evaluate potential competitors in the new domain, their strengths, weaknesses, market share, and strategies.
6.3. Regulatory and Compliance Factors: Research any legal, regulatory, or compliance aspects associated with entering the new market or domain.